The Indonesian Central Bank intervened in the foreign exchange market after the rupiah fell to a record low in Indonesia.

Indonesian Central Bank Deputy Governor Destry Damayanti said on Tuesday that the central bank has taken measures to maintain the stability of the Indonesian rupiah and prevent excessive fluctuations after the rupiah hit a record low against the US dollar.

“Stabilizing the rupiah exchange rate is undoubtedly our top priority at the moment. We will deploy all available tools and policies to do our best,” she said, adding that the pressure on the rupiah mainly stems from global conditions, including market reactions to the US-Iran conflict.

According to LSEG data, the rupiah exchange rate against the dollar briefly fell by 0.35% on Tuesday morning, to 17,090. Data shows that the rupiah has depreciated by over 2% against the dollar so far this year, aligning with the trend of some regional currencies.

Damayanti stated that the Bank of Indonesia has intervened in the spot and non-deliverable forward foreign exchange markets and is prepared to purchase government bonds in the secondary market if necessary. Authorities will also increase capital inflows by enhancing the attractiveness of securities denominated in rupiah (i.e., SRBI).

She noted that a weakening rupiah will undoubtedly have a negative impact on economic activity, but the rise in prices of major commodities will help offset this effect.